Stocks finished off their best levels but the Dow still posted a fresh closing high Tuesday. And the S&P 500 traded within 2 points of its all-time peak earlier in the session.
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The Dow Jones Industrial Average gained 59.98 points to finish at 14,673.46 after rallying to hit a fresh all-time high at 14,716.46. Microsoft and Intel led the top performers.
Interestingly, the blue-chip index has yet to log a three-day losing streak this year. The last time the Dow went this far into a year without a losing streak of that length was 1976. The Dow ended that year with a 18 percent rally.
The CBOE Volatility Index (VIX), widely considered the best gauge of fear in the market, slid below 13.
Among key S&P sectors, materials rallied, while utilities slid.
Alcoa ended unchanged after the aluminum producer reported an increase in quarterly profit as performance in its alumina and primary metals segments improved despite a tough market, but revenue fell slightly short of estimates. Still Alcoa CEO Klaus Kleinfeld told CNBC that he remains "relatively optimistic" that 2013 will be better than 2012 and continues to project 7 percent global demand growth in aluminum.
Alcoa unofficially kicked off this quarter's earnings season, which is expected to be fairly weak.
(Read More: Earnings Season Could Bring 'April Anxiety')
For the first quarter, earnings growth is expected to gain by just 1.6 percent, compared to 6.2 percent last quarter, according to Thomson Reuters. The negative warnings are higher than usual—with 108 negative revisions for S&P 500 companies. Compared to the 23 positive revisions, it is the worst pace in 12 years, according to Thomson Reuters data.
(Read More: Earnings Season Arrives as Data Flash Warning Signs)
First Solar skyrocketed more than 45 percent after the solar company announced it expects 2013 earnings of between $4 a share and $4.50 a share and revenue of between $3.8 billion and $4 billion, exceeding current Thomson Reuters expectations for $3.51 a share on sales of $3.12 billion. Rivals including Suntech Power and LDK Solar also soared.
Herbalife slid after being halted for nearly two hours following news that KPMG resigned as auditor for the nutrition, weight management and skin-care products company, according to the New York Times.
Skechers rose after the footwear retailer also announced the resignation of KPMG as its lead auditor. In a statement, Skechers said that the resignation was "due to misconduct by KPMG's lead audit engagement partner on the Skechers account." Shares were briefly halted earlier.
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JCPenney tumbled more than 12 percent to lead the S&P 500 laggards after the company said former CEO Myron Ullman will return as the retailer's chief after Ron Johnson was ousted by the board. Ullman will an annual base salary of $1 million. Adding to woes, the company's sales are down more than 10 percent so far in the first quarter versus a year ago, according to Dow Jones.
(Read More: Cramer: Ullman 'Right Choice' for JCP, but 'I Worry')
Disney edged up slightly as the conglomerate readies to lay off 150 people this week, according to sources close to the situation. The job cuts will be predominately in home entertainment, as the company adjusts to industry-wide declines in DVD sales.
Traders will be looking out for clues about the future of quantitative easing this week, with the Federal Reserve set to release minutes from its last meeting on Wednesday.There are also several appearances by Fed officials this week, including anti-inflation hawk Jeffrey Lacker and Atlanta Federal Reserve President Dennis Lockhart on Tuesday.
(Read More: Pimco's Bill Gross: Beware of 'Monetary Red Bull')
U.S. Fed Chairman Ben Bernanke spoke overnight on Monday at an Atlanta Fed conference. In a speech that did not directly touch on monetary policy, Bernanke hinted at why the central bank continues to pursue ultra-easy monetary policy.
"The economy is significantly stronger than it was four years ago, although conditions are clearly still far from where we would all like them to be," he said.
Meanwhile, St. Louis Federal Reserve Bank President James Bullard told CNBC that he'd be willing to reduce the central bank's massive bond-buying program in "small increments."
The government auctioned $32 billion in 3-year notes at a high yield of 0.342 percent. The bid-to-cover ratio, an indicator of demand, was 3.24.
On the economic front, wholesale inventories logged its biggest decline since September 2011 in February, according to the Commerce Department. Meanwhile, the National Federation of Independent Business reported that business confidence fell again in March.
In Europe, industrial production in the U.K. rose by more than expected in February, diminishing the risk the economy slipped back into recession in the first quarter of 2013.
(Read More: In Effort to 'Rebalance,' Europe Sticks to Austerity)
Meanwhile, U.S. Treasury Secretary Jack Lew pushed for a growth rather than an austerity agenda during the first day of his two-day visit to Europe. Speaking in Brussels, Lew said that the U.S. had an "immense stake in Europe's health and stability" and called on Europe to boost demand.
China's annual consumer inflation eased to 2.1 percent in March from February's 3.2 percent while producer price deflation deepened, data showed on Tuesday, leaving policymakers room to keep monetary conditions easy and nurture a nascent recovery.
—By CNBC's JeeYeon Park (Follow JeeYeon on Twitter: @JeeYeonParkCNBC)
Coming Up This Week:
WEDNESDAY: Mortgage applications, Fed's Lockhart speaks, Fed's Kocherlakota speaks, oil inventories, IMF's Lagarde speaks in NYC, 10-yr note auction, FOMC minutes, Treasury budget, Obama budget blueprint released; Earnings from CarMax, Constellation Brands, Chevron (interim report), Bed Bath & Beyond
THURSDAY: Fed's Plosser speaks, Fed's Bullard speaks, Jobless claims, import/export prices, natural gas inventories, 30-yr bond auction, Fed balance sheet, money supply, Deutsche Bank annual mtg; Earnings from Pier 1 Imports, Rite Aid, JB Hunt
FRIDAY: PPI, retail sales, consumer sentiment, business inventories, Bernanke speaks at Fed's development conf.; Earnings from JPMorgan, Wells Fargo
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